“ FIVE YEARS AGO, I WOULD HAVE AGREED THERE’S AN EDUCATION GAP. TODAY, HOWEVER, I’VE SEEN A DRAMATIC SHIFT AND ESG IS NOW AT THE TOP OF THE AGENDA FOR THE INDUSTRY AS A WHOLE.”
RYAN MCNELLEY, DUFF & PHELPS’ VALUATION ADVISORY PRACTICE
and investment firms that will help the UK meet its net-zero climate target, but tools that make investing in green and sustainable investment products attractive to investors and enable investors to make simple changes to the way they view investment opportunities.” Ilaria Calabresi, Sustainable
Investment Lead at J.P. Morgan Private Bank says companies – large or small – are realizing that integrating sustainability is needed in order to stay competitive. “Some corporates might have
started this journey towards sustainability, though still have low awareness of what factors asset managers and rating agencies are focusing on when looking at companies’ performance on ESG considerations,” she says.
“Asset managers can play a role in supporting companies by helping them to understand those specific factors as well as teaching them that becoming a leader on ESG factors has been proven to increase profitability, reduce risk and allow access to cheaper capital.”
IS YOUR BUSINESS KEEPING UP? New research by Addleshaw Goddard has revealed that large European businesses are making faster progress on sustainability than medium-sized businesses, with the gap expected to become even more pronounced over the next four years. The law firm found that
financiers intend to turn off the funding tap to companies within at least two key sectors by 2025 if they fail to provide a carbon transition strategy, with real estate and healthcare most at risk. The combination of these factors could disproportionately impact the ability of medium-sized businesses to thrive in the medium term. Based on the views of 1,000
business and finance leaders, the research reveals that medium-sized businesses are falling behind on sustainability for several reasons. These include:
• a lack of a joined-up response among industry (a barrier for 76% of mid-size businesses vs 50% of very large businesses);
• difficulty in raising new equity finance (75% vs 56%);
• government regulation (73% vs 52%); and
• a lack of access to good quality sustainability data (75% vs 60%).
Both mid-size and very large businesses cite
pressure to keep
costs low as the biggest barriers preventing them from becoming more sustainable (81% of mid-size businesses vs 75% of very large businesses).
Sustainability was found to be
a top-two boardroom priority for only 17% of mid-sized businesses compared to over a quarter of very large businesses (26%). 72% of medium-sized businesses expect that sustainability will become a top-two boardroom priority by 2025, compared to 82% of very large businesses. Amanda Gray, Partner,
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